Compliance with Financial Laws

Mortgage brokers must comply with a range of laws including the Real Estate Settlement Procedures Act (RESPA), Truth in Lending Act (TILA), Fair Credit Reporting Act (FCRA), Equal Credit Opportunity Act (ECOA), and others. They also have to abide by state-specific licensing requirements and regulations.

TILA requires you to provide borrowers with clear, detailed information about their loans, including the terms, interest rates, and costs. You should always disclose this information accurately and transparently, and document everything for your records.

FCRA violations could include failing to obtain proper authorization before pulling a credit report, not providing adverse action notices when denying or altering credit based on a credit report, or not properly handling disputes about inaccuracies on credit reports.

ECOA prohibits discrimination against applicants on the basis of race, color, religion, national origin, sex, marital status, age or because they receive income from public assistance programs. To ensure compliance with ECOA make sure all decisions are made solely based on an applicants financial information without considering any protected characteristics.

RESPA is designed to protect consumers from abusive practices like kickbacks or referral fees among real estate settlement service providers. As such its important that no such arrangements exist within your business model. Additionally you should provide clear Good Faith Estimates of settlement costs and make sure affiliated businesses are disclosed correctly.